SEO Title: IFSCA Amends FCA Rules for Indian Residents
Summary: The International Financial Services Centres Authority (IFSCA) issued a circular on June 23, 2025, to amend existing directions concerning the operation of Foreign Currency Accounts (FCAs) held by Indian resident individuals under the Liberalised Remittance Scheme (LRS). This amendment specifically revises paragraphs 3(ii) and 4(ii) of the previous directions dated December 13, 2024. The core change requires Indian Resident Individuals (RIs) to provide a declaration. This declaration confirms that any funds spent from their FCA for financial services or products within an IFSC, or any amount remitted from their FCA, aligns with the purpose originally declared when the money was remitted under LRS, or is for another LRS-permitted purpose. This circular, effective immediately, falls under the IFSCA’s authority to regulate financial products, services, and institutions within IFSCs.
International Financial Services Centres Authority
Circular No. IFSCA-FMPP0BR/1/2021-Banking-Part(1)/3|Dated: June 23, 2025
To,
All IFSC Banking Units (IBUs)
Subject: Amendment to the ‘Directions to IBUs for operations of the Foreign Currency Accounts (FCA) of Indian resident individuals opened under the Liberalised Remittance Scheme (LRS)’
1.Reference may be drawn to the ‘Directions to IBUs for operations of the Foreign Currency Accounts (FCA) of Indian resident individuals opened under the Liberalised Remittance Scheme (LRS)’ issued vide Circular F. No. IFSCA-FMPP0BR/1/2021-Banking-Part (1)/3 dated December 13, 2024.
2. The said directions are hereby amended by :
a. replacing para 3 (ii) of the extant directions with the following :
“(ii) obtain a declaration from the RI, confirming that amount being spent from its FCA for availing financial services or financial products in IFSC is for the purpose declared while remitting the money to the FCA under LRS or is for a purpose permitted under LRS”.
b. replacing para 4(ii) of the extant directions with the following :
“ (ii) obtain a declaration from the RI, confirming that amount being remitted from its FCA is for the purpose declared while remitting the money under LRS or is for a purpose permitted under LRS”.
3. This circular is issued in exercise of powers conferred by section 12 and 13 of the IFSCA Act 2019, to develop and regulate the financial products, financial services and financial institutions in the IFSCs and the amendments to the Guidelines shall come into force with immediate effect.
4. A copy of this circular is available on the website of the IFSCA at https://ifsca.gov.in/Legal/Index
Yours faithfully,
Supriyo Bhattacharjee
Chief General Manager
(Head – Department of Banking)
